Debt and Financing Arrangements

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Debt and Financing Arrangements

2.    Debt and Financing Arrangements

At December 31, debt consisted of the following (in thousands):

	December 31, 2021		December 31, 2020
Credit Agreement with Banks, described below	$	—	$	—
Finance Leases, described below		50,404		70,976
Total debt		50,404		70,976
Less: current portion of long-term debt		19,396		20,588
Long-term debt, less current portion	$	31,008	$	50,388

The Company's liquidity needs arise primarily from capital investment in new equipment, land and structures, information technology and letters of credit required under insurance programs, as well as funding working capital requirements.

The Company is party to a revolving credit agreement with a group of banks to fund capital investments, letters of credit and working capital needs. The Company has pledged certain land and structures, accounts receivable and other assets to secure indebtedness under this agreement.

Credit Agreement

The Company is party to a credit agreement with its banking group that provides for a $300 million revolver with a term ending February 2024.  The credit agreement also has an accordion feature that allows for an additional $100 million availability, subject to certain conditions and availability of lender commitments.  The credit

agreement provides for a LIBOR rate margin range from 100 basis points to 200 basis points, base rate margins from minus 50 basis points to plus 50 basis points, an unused portion fee from 17.5 basis points to 30 basis points and letter of credit fees from 100 basis points to 200 basis points in each case based on the Company’s leverage ratio.  Under the credit agreement, the Company must maintain a minimum debt service coverage ratio set at 1.25 to 1.00 and a maximum leverage ratio set at 3.25 to 1.00.  The credit agreement provides for a pledge by the Company of certain land and structures, accounts receivable and other assets to secure indebtedness under this agreement.  The credit agreement contains certain customary representations and warranties, affirmative and negative covenants and provisions relating to events of default. Under the credit agreement, if an event of default occurs, the banks will be entitled to take various actions, including the acceleration of amounts due.

At December 31, 2021, the Company had no outstanding borrowings and outstanding letters of credit of $29.3 million under the credit agreement. At December 31, 2020, the Company had no outstanding borrowings and outstanding letters of credit of $27.2 million under the credit agreement. The available portion of the credit agreement may be used for general corporate purposes, including capital expenditures, working capital and letter of credit requirements as needed.

Finance Leases

The Company is obligated under finance leases with seven-year terms which include obligations collateralized by revenue equipment totaling $50.4 million and $71.0 million as of December 31, 2021 and 2020, respectively. Amortization of assets held under the finance leases is included in depreciation and amortization expense. The weighted average interest rate for the finance leases at December 31, 2021 and 2020 is 3.55% and 3.48%, respectively.

The estimated fair value of the finance leases at December 31, 2021 and 2020 is $50.8 million and $71.2 million, respectively, which is based on current market interest rates for similar types of financial instruments, reflective of Level 2 inputs.

Other

The Company paid cash for interest of $3.0 million, $5.9 million, and $6.4 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Principal Maturities of Long-Term Debt

The principal maturities of long-term debt, including interest on finance leases, for the next five years (in thousands) are as follows:

	Amount
2022	$	20,956
2023		15,409
2024		10,606
2025		5,453
2026		919
Thereafter		—
Total		53,343
Less: Interest on Finance Leases		2,939
Total	$	50,404